NYC Pay History Ban: Combating Wage Disparity

The New York City Council approved legislation on Wednesday, April 5, 2017, which bans NYC employers from relying on past salary history when making hiring decisions. The legislation, known as Introduction 1253-A, is intended to prevent the single interview question: “How much did you make at your previous job?”

Proponents of the legislation suggest that the prohibition will combat gender-based wage disparities by preventing employers from setting wages based on previous salaries and help to end the perpetual cycle of women earning less than men insofar as the distinction is based on past practices. In addition, proponents of the legislation believe that withholding such information from employers will likely create more transparency in the hiring process and force employers to set salaries prior to conducting interviews. With this legislation, NYC joins the ranks of Massachusetts and Philadelphia, which recently passed similar laws.

The legislation, however, is not without its opponents and criticism, and it is expected that lawsuits will be filed prior to its implementation. In fact, on April 6, 2017, the Chamber of Commerce for Greater Philadelphia filed a federal lawsuit challenging a similar Philadelphia law on First Amendment grounds. That lawsuit seeks injunctive relief, alleging that the law unduly burdens an employer’s ability to rely on wage history during the job-application process. NYC employers should pay close attention to the Philadelphia lawsuit as a favorable decision for the Chamber of Commerce will likely influence challenges to Introduction 1253-A.

We will keep our readers updated with respect to the implementation of Introduction 1253-A and any challenges brought against it.